When Saudi Crown Prince Mohammed
bin Salman meets Indian Prime Minister Narendra Modi next week, the elephant in
the room is likely to be what weighs more: the issues the two men agree on or
the ones that divide them.

As a
matter of principle, Prince Mohammed and Mr. Modi are likely to take their
strategic partnership to a new level as a result of changing energy markets, a
decline in American power, the rise of China and the transnational threat of
political violence.

Discussions
with the crown prince and his delegation of Saudi businessmen on energy and
investment will prove to be the easy part. Saudi Arabia is investing US$44
million in a refinery in Maharashtra’s Ratnagiri and supplies 20 percent of
India’s crude oil. India, moreover, expects the Saudis to invest in ports and
roads while Saudi Arabia is interested in Indian agriculture that would export
products to the kingdom.

At first
glance, security issues should be a no-brainer. The two countries hold joint
military exercises, share intelligence and cooperate on counterterrorism. They
are also working to counter money laundering and funding of political violence.
Things get complicated, however, when geopolitics kicks in. Prince Mohammed
arrives in Delhi on the back of a visit to Pakistan, where he is expected to
sign a memorandum of understanding on a framework for $10 billion of
investments, primarily in oil refining, petrochemicals, renewable energy and
mining.

File image of Saudi
Arabia’s Crown Prince Mohammed bin Salman. AP

The memo
follows significant Saudi aid to help Pakistan evade a financial crisis that
included a $3-billion deposit in Pakistan’s central bank to support the
country’s balance of payments and another $3 billion in deferred payments for
oil imports.

The
tricky part are the investments in the memorandum that include a plan by the
Saudi national oil company Aramco to build a refinery at the Chinese-backed
port of Gwadar, close to Pakistan’s border with Iran and the Indian-backed
Iranian port of Chabahar. Both Pakistan and Saudi Arabia are closely monitoring
Chabahar’s progress.

A
potential Saudi investment in the troubled Pakistani province of Balochistan’s
Reko Diq copper and gold mine would strengthen the kingdom’s hold in the
strategic province that both Prince Mohammed and US president Donald J Trump’s
hardline national security adviser John Bolton see as a potential launching pad
for efforts to destabilise Iran. Taken together, the refinery, an oil reserve
in Gwadar and the mine would also help Saudi Arabia in efforts to prevent
Chabahar from emerging as a powerful Arabian Sea hub.

Saudi
funds are flowing into ultra-conservative anti-Shiite, anti-Iranian Sunni
madrassas in Balochistan. It remains unclear whether the money originates with
the Saudi government, Saudi nationals of Baloch descent or the two
million-strong Pakistani diaspora in the kingdom.

The money
helps put in place building blocks for possible covert action should the
kingdom or the US — or both — decide to act on proposals to support irredentist
action.

Such
covert action could jeopardise Indian hopes to use Chabahar to bypass Pakistan,
enhance its trade with Afghanistan and Central Asia and create an antidote to
Gwadar, a crown jewel in China’s Belt and Road initiative.

Pakistani
analysts expect around $5 billion in Afghan trade to flow through Chabahar
after India in December started handling the port operations. It could also
further strain ties with Pakistan that accuses India of fomenting nationalist
unrest in Balochistan.

The funds take on added
significance in the face of Saudi concerns about Chabahar and India’s support
for the port. The money continues to flow even though the crown prince has
significantly cut back on the kingdom’s global funding of ultra-conservative
Sunni Muslim groups to bolster his assertion that the kingdom is embracing a
more moderate, albeit as yet undefined, form of Islam.

The money started coming in at about the time the Riyadh-based International
Institute for Iranian Studies published a study that said Chabahar posed a
“direct threat to the Arab Gulf states” that called for “immediate
countermeasures”.

Written
by Mohammed Hassan Husseinbor, a Washington-based Iranian Baloch lawyer and
activist, the study warned that Chabahar would allow Iran to step up oil
exports to India at the expense of Saudi Arabia, raise foreign investment in
the Islamic Republic, increase government revenues and allow Tehran some
muscle-flexing in the Gulf and the Indian Ocean. Noting the expanse of Iran’s
Sistan and Balouchestan province, Mr. Husseinbor said “it would be a formidable
challenge, if not impossible, for the Iranian government to protect such long
distances and secure Chabahar in the face of widespread Baluch opposition,
particularly if this opposition is supported by Iran’s regional adversaries and
world powers”.

Published
in a country that tightly controls the media as well as the output of think
tanks, the study stroked with a memorandum drafted a year later by Bolton
before he assumed office. The memo envisioned US support “for the democratic
Iranian opposition”, including in Balochistan and Iran’s Sistan and Baluchestan
province.

Iranian
officials believe that Saudi Arabia and the US have a hand in a string of
recent attacks by Baloch, Kurdish and Iranian Arab nationalists but have so far
refrained from producing anything beyond allegations. Most recently, they point
to a rare suicide bombing in Chabahar in December that targeted a Revolutionary
Guards headquarters, killing two people and wounding 40.

Writing
in the Pakistan Security Report 2018, journalist Muhammad Akbar Notezai said,
“to many in Pakistan” concerns about Indian support for the Baloch “were
materialized with the arrest of Kulbushan Jadhav, an Indian spy in Balochistan
who had come through Iran. Ever since, Pakistani intelligence agencies have
been on extra-alert on its border with Iran”.

The
journalist warned that “the more Pakistan slips into the Saudi orbit, the more
its relations with Iran will worsen… If their borders remain troubled, anyone
can fish in the troubled water”.

Mr.
Notezai implicitly put his finger on the pitfalls Prince Mohammed and Mr. Modi
will have to negotiate to ensure that their ever closer economic, energy and
security relations can withstand the challenges posed by the escalating and
intertwined rivalries that link West and South Asia.